Self Employed Mortgage UK
Self Employed Mortgage UK - Lender Criteria Revealed
Do you need a self employed mortgage UK, or would a self-employed mortgage UK be most suitable because of the nature of your income and your residential status? Or do you consider yourself as employed by your own limited company, but the lenders classify you as self-employed?
Why would a self employed mortgage UK applicant find it more difficult to meet a lender's criteria than their employed friends, who may earn less money, but are told they can borrow more? It makes even less sense if you have a clean credit history and have run your own successful business for several years.
It is more common than you'd think
It is a common problem because there are a variety of reasons you may not meet a lender's normal requirements and may need a self employed mortgage UK instead. For employed people it is easy to prove their income, by producing pay slips for instance. The lender will calculate the GROSS annual salary and then multiply it to arrive at the amount of mortgage available.
For a self employed mortgage UK it would be more complicated if there weren't special schemes. For instance the lender may rely only on the NET profit shown in your business accounts, even though your disposable income may be significantly greater. Your accounts may not have been audited recently and so the lender will be assessing your requirements 
on past performance. You may even have been successful in arranging a lucrative new contract which will bolster your earnings, but this will not be reflected in your accounts. There are other benefits which lenders will not normally make allowance for, unless you apply for a self employed mortgage UK scheme.
Do I need an office?
Of course you don't need to have an office or shop to apply for a self employed mortgage UK. You don't even need to sell anything! For instance, you may be a writer and your income comes from royalties or from published articles. Or you could be an inventor with income from intellectual property.
You may be semi-retired and rely on income from a combination of shares, investments and property rental. Or you may be anything but retired - and earn income from overseas business activities. All of these situations, and more, would benefit from a self employed mortgage UK scheme.
If you are a company director it could be even more complicated. Your income could be a combination of salary, dividends, various benefits and tax allowances. You may also have left some profit in the business even though you could rightfully have taken it out. Which ever amounts will the lender allow in their calculations it is unlikely to be a true reflection of your disposable income.
If you fall into this category you may need a different type of 
mortgage, a self employed mortgage UK, where the lender allows you to declare how much your income is but will not require any evidence.
Are there any requirements I need to meet?
You will still need to meet income and other requirements and this will vary from lender to lender. In many situations the self employed mortgage UK products will be exactly the same as those offered for full status "proven income" mortgages, but in others the rates and terms may a little less favourable.
As for all mortgages, with a self employed mortgage UK your declared income must be a genuine reflection of your income and must not be an amount that has been thought up to meet the lenders criteria.
